Companies are turning to ChatGPT and Claude AI to provide research and analysis that might previously have been done by an Accenture partner for £500 an hour or more.
It is cheaper, quicker and often better as well. That said, the AI boom should also be powering the industry forward. With companies scrabbling to implement new systems, the AI giants spending tens of billions on data infrastructure that must be installed at record speed, with many major corporations starting to wonder whether entire business models will have to be turned upside down, there should be more demand for consultants than ever.
After all, rapid change and corporate reinvention are precisely what they claim to be experts at delivering. The corporate brochures and slick websites are littered with grandiose claims about “thought leadership” and “navigating change”. Arguably, this should be their moment.
In reality, the problem is not AI itself. The real issue is that the smart chatbots have exposed how shallow much of the consultancy racket has become.
Sure, it can produce plenty of spreadsheets and clever-looking forecasts. It can spin lots of clichés about “picking the low-hanging fruit”, “moving the needle”, or even “boiling the ocean” (which refers to overanalysing a problem for anyone who hasn’t bothered to keep up with all the latest jargon).
Very occasionally, it might be able to implement a project that a company lacks the resources to do itself. But very often it has become characterised by inflated bills for very mediocre work that was hardly even needed in the first place, and if it were, could have been done at a fraction of the price.
AI has exposed precisely that. It is not that chatbots are especially clever. They might be one day, but they are certainly not there yet. But they are brilliant at regurgitating waffle and bluster that might sound good at first glance, but have all the depth, originality and understanding of an over-confident first-year trainee.
You can’t use ChatGPT or Claude to come up with original writing, a brilliant advertising slogan or a new product that no one has ever thought the market wanted before. But you can use it to generate a corporate mission statement or a set of HR goals that will be just as good as the one that cost a hundred grand from one of the major consulting firms.
There is a space for genuinely innovative consultancy. The type of work that McKinsey, Bain or the Boston Consulting Group produced when the industry was first created half a century or more ago was original and groundbreaking.
Some of it still is, and there will always be a demand for that. And yet the AI boom has exposed a stark fact.
Much of mainstream consulting is so routine that it can be easily replicated by a smart machine. The collapse in the Accenture share price is, if we are being honest, just the start. Unless they can reinvent themselves very quickly, the giant consulting firms are in big trouble – or rather heading towards a “cascading critical path failure”, as they might put it themselves.